With 33,000 U.S. troops returning from Afghanistan to a nation still wracked by a recession and persistent unemployment, President Obama is proposing using tax credits to encourage private companies to hire jobless veterans, senior administration officials said Thursday. Obama on Friday will unveil a plan that offers a $4,800 tax credit to companies that hire veterans who have been unemployed for more than six months. If the veteran has been out of a job for less than six months, the tax credit would be $2,400. Companies would get a $9,600 tax credit if they hired a disabled vet.
The proposal, for which the administration offered no cost estimate, would require congressional approval. The credits would be made available in 2012 and 2013.
“We are facing some of the most serious problems coming out of this deep, deep recession that we’ve seen in terms of long-term unemployment,” one of Obama’s economic advisers said. “The president feels that our veterans … deserve all the support that we as a country can give them to find new careers.”
Obama’s timing — announcing his plan while Congress is out of town on a monthlong recess — is likely aimed at cushioning what could be another disappointing jobs report Friday.
Roughly 13 percent of veterans who have served since 9/11 — about a quarter-million combat veterans — were out of work in June, a jobless rate even higher than the national average of 9.2 percent. Just a year ago, the unemployment rate among veterans was 11.5 percent.
“These numbers are creeping up, and it’s just the beginning,” said Matt Gallagher, an Iraq war veteran who spent a year looking for work after returning home.
The administration is clearly concerned that those jobless numbers could rise over the next 13 months as the United States begins to withdraw its forces from Afghanistan. Obama ordered 10,000 troops home by year’s end and an additional 23,000 by September 2012.
Many veterans are unable to find work largely because they have a hard time translating their military experience into the kind of skills that prospective employers need, said Gallagher, who now works for Iraq and Afghanistan Veterans of America.
“Firefights typically don’t make much sense to an employer,” he said. “They make for good stories in a bar, but often don’t make an employer be intrigued in an employee.”
The military’s existing training program for soldiers re-entering civilian life hasn’t been particularly successful, senior administration officials said.
With all the upfront training that soldiers receive before heading into combat, “what we’re finding is there’s not as much effort on the back end as those service members are separating and preparing to enter the work force,” one official said.
But with Congress out of town until September and $1.5 trillion in budget cuts looming, the administration could face some friction for proposing another spending program.
The White House plans to meet with the leaders of the House and Senate finance committees to craft legislation as soon as lawmakers return from recess.
